I'm wondering why the installation files for a game would be 10-20% smaller now than in the past. Does this mean that some content has been removed?

I doubt it, but without examples it's hard to say.

One thing I do know is that some games which use redbook audio were originally released here with a full CD image included in the installer, which was used to play the audio in-game. At least some of those have since been replaced by .ogg files. Heroes of Might and Magic 2 is an example of that. So while nothing was removed from the game, the installer is much smaller than it used to be.

I also noticed the overall smaller installers.

I guess GOG finally choose a better compression algorithm for all of their new installers.
Though I have not check and verify them yet.

Depends on the game. Check the game changelog if it reveals anything.

One such case I remember was "Edna & Harvey: Harvey's New Eyes". At some point (July 2016) the size of the installer dropped from 2 GB to 802 MB, so the new installer is under half the size. Not sure why exactly, the changelog said "Engine Update to Visionaire 4.2.5", not sure if that alone explained the size reduction, or was something else left out from the installer (like some DirectX installers and such).

I decided to keep the old installer, just to make sure first GOG had not screwed up anything, but I guess not. Somehow the game just got smaller. I didn't inspect the installers, like uncompressing them with innoextract to see what they've eaten. How many? If that is the case, then gogrepo users (like me) should be seeing lots of changed installers. Any specific games, are they mainly newer games or also older classics, etc.?

EDIT: Or did you mean that to you newer GOG releases appear to be smaller than older releases, not that older game installers have been reduced in size?

And we are talking about the classic installers without GOG Galaxy embedded, right? This is not related of GOG replacing the embedded Galaxy installer with a smaller stub installer (on the Galaxy-embedded versions)? After all the Galaxy installer was an extra 120MB or so per game (compressed).

Many new GOG installers shrink a bit, filesize become 95~99% of old installers.

Some big changes that I guess is not due to compression algorithm change:
217756776 setup_balrum_2.3.0.7.exe (old)
217728184 setup_balrum_2.4.0.8.exe (old)
167503888 setup_balrum_1.3_(14388).exe (new)
168194288 setup_balrum_1.31_(15203).exe (new)

922225376 setup_stronghold_crusader_extreme_hd_2.2.0.8.exe (old)
730877584 setup_stronghold_crusader_extreme_hd_1.4_(14769).exe (new)

916149120 setup_epistory_typing_chronicles_2.1.0.3.exe (old)
571913872 setup_epistory_32_1.3.5_(12568).exe (new)
580445400 setup_epistory_64_1.3.5_(12568).exe (new) Right.

So what are the games with the 10-20% reduced installer size?